This week NASF joined a coalition of forestry organizations to present comments to the Committee on Ways and Means regarding the Tax Working Group process. The letter expressed coalition views on the existing tax treatment of working forests across America.
The comments highlighted three provisions in the tax code that Congress has adopted to reflect the unique nature of the forest products industry which are critical to sustaining private ownership of forestland. The three provisions are:
Deduct the costs of forest management, including prevention measures (fire, pest and disease), thinning, fertilization, interest, taxes, protection of wetlands and endangered species, and forestry activities.
Receive capital gains treatment for the harvest of timber or sales of standing trees.
Deduct up to $10,000 of reforestation costs per stand, with the remainder amortized over 7 years.
The coalition encouraged Congress to consider that timber is a long-term investment, decisions to invest in timber were made decades ago, and changing the tax treatment would significantly and negatively impact investments in working forests that contribute to economic growth and environmental quality.